A STRONG session for mining stocks following a positive trading update from Xstrata helped the FTSE 100 Index pull out of its tailspin today.
A late rally in New York on Friday also settled nerves after a week of fretting about the impact of European sovereign debt sent the Footsie to a three-month low near 5000.
Mining dominated the risers board today as the top flight index improved 52.9 points to 5113.9. Xstrata helped the mood after it reinstated dividends and offered an encouraging outlook about medium-term demand for commodities.
Shares were 44p higher at 993.6p, a gain of 4%, while Randgold Resources lifted 273p to 4482p after it hiked its dividend by 30% and announced a sharp rise in fourth quarter profits.
Other major gains in the sector were achieved by Rio Tinto, which lifted 90p to 3127p, while Anglo American added 65p to 2339p.
In a quiet session for corporate news, St Modwen Properties set the pace in the FTSE 250 after it said it was confident of returning to profit in 2010.
The property regeneration firm posted a pre-tax loss of £97.7 million for last year but shares still rose 6% or 10.2p to 196.7p.